Volume 44, Number 174,
July-September 2013
Schumpeter and the Post-Schumpeterians:
Old and New Dimensions of Analysis *
Gabriel Yoguel,** Florencia Barletta***
and Mariano Pereira***
Date received: July 30, 2012. Date accepted: January 17, 2013

This article discusses the major ideas of Schumpeter and identifies changes or breaks in his line of thinking throughout his works. His major contribution was to explain the dynamics of economic development based on the emergence of processes of creative destruction that take place under different forms of competition. Many years later this legacy became relevant in developing evolutionary and neo-Schumpeterian theory. This article also presents the elements missing from this thinking, later developed by evolutionary and neo-Schumpeterian theory. Among them, the importance of learning processes and the development of competition in companies, diffusion mechanisms for innovation and the role of institutions are especially notable.

Keywords: Economic Development, Creative Destruction, Innovation, Capacities, Competition.

Joseph Alois Schumpeter developed the idea that the economic development of a system constitutes an endogenous process generated in unstable conditions, and that competition is based on a process of creative destruction in different market structures, in his Theory of Economic Development (1912, hereafter referred to as the ted), Business Cycles (1939), Capitalism, Socialism and Democracy (1942, hereafter referred to as csd) and Creative Responses in Economic History (1947, hereafter referred to as creh). However, his ideas were practically forgotten in the 30 years following his death. Richard Nelson and Sidney Winter rediscovered these theories in 1982 with the publication of their book, entitled, An Evolutionary Theory of Economic Change. Thus began a strong tradition of evolutionary and neo-Schumpeterian works that renewed and updated Schumpeter’s1 theories, developing new analytical dimensions that were absent in his texts.

The objective of this article is therefore to discuss which of Schumpeter’s ideas are still relevant in the modern evolutionary theory of innovation and technological change. The questions that guide this article are as follows: What are the breaks and continuities in Schumpeter’s work? What dimensions have been reclaimed by evolutionary and neo-Schumpeterian literature? What new dimensions have been proposed in this literature?

The first section presents the major ideas of Schumpeterian thought, identifying continuities and breaks throughout his works. The second section indicates the ideas that authors from evolutionary and neo-Schumpeterian schools of thought have borrowed from his works and discusses this field’s new contributions. Finally, the last section provides some conclusions.


The evolutionary path of Schumpeterian thought can be summarized in the following ways: i) the dynamics of economic development understand as the development of new combinations (introducing and improving new products and processes, organizational changes and new ways of reaching markets), ii) the phenomenon of creative destruction driven by entrepreneurs that introduce these combinations in unstable conditions and iii) the process of competition and the market structure in which this phenomenon is situated.

The Dynamics of Economic Development

In chapter 2 of the ted, and also in Chapter 7, “The Economy as a Whole” (later eliminated from the first edition of the ted, and hereafter referred to as C7), Schumpeter describes economic development and defines its characterizing principles: i) it is a purely economic phenomenon, ii) it can only emerge based on a disturbance to equilibrium and iii) it is not present in aggregate form; rather it is manifest in multiple dynamics that involve a limited number of agents (Mathews, 2002).

Starting with a system of overall equilibrium2 (the circular economy), the emergence of new actors (entrepreneurs) generates disturbances, which bring about change. In the search for extraordinary profit, these entrepreneurs introduce new combinations and give rise to the process of creative destruction. Following the stage of instability, market selection mechanisms displace leaders that do not follow the new productive practices of entrepreneurs. Development culminates when there is a new coherent equilibrium with novel optimized conditions for the agents involved. This is achieved when new combinations become so widespread — through a surplus supply — that they lead to reduced prices, the disappearance of quasi-rents for entrepreneurs and the displacement of leaders.

*  The authors would like to acknowledge the comments received from the journal committee regarding a previous version of this article.

**    Director of the Knowledge Economy Department, Institute of Industry, Universidad Nacional de General Sarmiento, Argentina.
        E-mail: gyoguel@ungs.edu.ar, www.ungs.edu.ar/piec,

***  Researchers and professors at the Institute of Industry, Universidad Nacional de General Sarmiento, Argentina.
        E-mails: fbarlett@ungs.edu.ar and mpereira@ungs.edu.ar, respectively.

1 Some authors that fit into this way of thinking, albeit from different perspectives, include Antonelli, 2011; Dopfer, 2006; Dosi, 2000; Fagerberg, 2003; Freeman, 1995; Foster, 2000; Langlois, 2007; Lundvall, 1992; Malerba y Orsenigo, 1997; Metcalfe, 1998, 2010; Perez, 2010; Reinert, 2000; Rosemberg, 2011; Saviotti, 1996 and Witt, 2002, among others.

2 Starting with a general system of Walrasian equilibrium where Say’s law and Euler’s theorem are met, there is a subjective theory of value, returns are decreasing and prices match marginal costs.

Published in Mexico, 2012-2017 © D.R. Universidad Nacional Autónoma de México (UNAM).
PROBLEMAS DEL DESARROLLO. REVISTA LATINOAMERICANA DE ECONOMÍA, Volume 49, Number 193, April-June 2018 is a quarterly publication by the Universidad Nacional Autónoma de México, Ciudad Universitaria, Coyoacán, CP 04510, México, D.F. by Instituto de Investigaciones Económicas, Circuito Mario de la Cueva, Ciudad Universitaria, Coyoacán,
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